Press Release

DEPARTMENT OF FINANCIAL SERVICES:
HEALTH INSURANCE EXCHANGE IS VITAL TO SMALL BUSINESS GROWTH; WILL HELP ECONOMY
GROW & CREATE JOBS

Small Business Community,
Insurance Brokers & Health Insurers Stand With Cuomo Administration to Urge Immediate
Passage so New York Doesn’t Lose Control to Federal Government

Benjamin
M. Lawsky, Superintendent of Financial Services, was joined by the small business
community, insurance brokers and health insurers in calling for immediate passage
of legislation included in the budget to create a New York health insurance exchange
because it will be good for business and help create jobs. If the legislation
is not passed now, the federal government will run the exchange and New York will
not be able to make important decisions about how it operates and who it serves.

“Affordable health insurance is one of the top issues for businesses, especially
small business. New York’s more than 400,000 small businesses are our engines
of growth, generating two-thirds of all new jobs. Helping those businesses grow
will improve the entire state’s economy. This should not be a Republican or Democratic
issue — it’s about jobs,” Superintendent Lawsky said. “If New York waits any longer,
the federal government will impose an exchange not tailored to the needs of our
small businesses and consumers. Certification for the state exchanges begins in
mid-2012 and we must be able to demonstrate we can run it by January 2013. If
we don’t start building ours immediately, we will have a federal exchange in 2014.”

Last year, Gov. Andrew M. Cuomo, and the Senate and Assembly agreed to
compromise language to create the exchange. The language in this year’s budget
reflects that agreement. But the Senate, which agreed to create the exchange last
year, has not included it in its budget this year.

The federal government
will operate exchanges for states that do not create their own. That means the
exchange and its jobs could be located outside New York. More important, a federal
exchange may not be the best design for New Yorkers. New York requires minimum
benefits and prohibits insurers from charging higher premiums to seniors and small
businesses with older employees. A federal exchange operating in New York may
provide fewer health insurance benefits, while charging older New Yorkers higher
premiums.

“This issue is too important to too many people and businesses
to let it be scuttled by politics in an election year. Let’s pass the exchange
now, to help New York’s small businesses thrive and create jobs to lead our economic
recovery,” Superintendent Lawsky said.

Chuck Steiner, Chair of Chamber
Alliance of New York State (CANYS), which represents chambers of commerce around
the state, said, “As negotiations continue related to the establishment of a Health
Insurance Exchange in New York, CANYS supports the creation of a public authority
that would have oversight of the exchange in New York State. We encourage the
involvement of chambers of commerce, business associations and brokers as a means
of distributing products within the exchange.”

Benjamin Geyerhahn, director
of special projects, Small Business Majority, a small business advocacy organization,
said, “Healthcare premiums are spiraling out of control and insurance plans are
getting more complicated every year. As proposed, the New York health insurance
exchange would reduce premium costs and make it easier for small businesses to
purchase healthcare insurance. The State should seize this historic opportunity
to provide relief to New York's small businesses. Unfortunately, the Senate's
inaction will force federal regulators to seize control of the New York exchange,
which no one wants.”

Paul F. Macielak, president & CEO, New York Health
Plan Association, a health insurance trade association, said, “HPA and its member
plans support the establishment of a New York exchange versus one developed under
a federal model. Health plans have been a partner in the state’s efforts to increase
access to affordable health insurance for New Yorkers and a state exchange allows
New York to control its own destiny as we continue working toward that goal.”

Andrew F. Biernat, President, New York State Association of Health Underwriters,
which represents brokers who sell health insurance, said, “We ask that all of
our State’s legislators act quickly and pass legislation that will allow us to
move forward in creating a New York State Health Insurance Exchange. The Empire
State has always been a leader and innovator in providing our residents with quality
health insurance that takes into account our State’s unique needs. If legislation
is not passed soon, the Federal Government will step in and create a Health Insurance
Exchange for New York, without taking into account the complexities and uniqueness
of the New York State insurance marketplace.”

Vincent C. Ashton, President
& CEO, HealthPass New York, which provides health insurance options for small
businesses, said, “Small businesses and individuals in New York State are trapped
in unaffordable, confusing and dysfunctional health insurance marketplaces that
threaten their health, livelihood and future. They desperately need a Health Benefits
Exchange designed by New Yorkers to meet the needs of New Yorkers, not a Federal
Exchange designed to meet the needs of the mythical ‘average American’, and which
is likely to be hobbled by compromise in order to insure that one size fits all
states.”

A health insurance exchange will offer a choice of reasonably
priced health insurance policies. Individuals and small businesses will be able
to compare rates, benefits and the quality of competing plans in an open and transparent
marketplace — thus encouraging insurers to offer more competitive prices and plans.
And federal tax credits will help consumers and small businesses pay for coverage.

The exchange will feature a Small Business Health Options Program, which
can act as a human resources department, helping employees make choices and enroll,
and collecting premiums to send to insurers. Small employers can set a defined
contribution toward employees’ coverage, and employees can choose from a broader
range of plans.

Some opponents have raised the issue of costs, but New
York State will not use any of its own funds to create or operate the exchange.
Federal grants are available to support the exchange through December 2014, when
under federal law, the exchange must be self-sustaining whether run by the state
or the federal government. New York has already received $88 million in health
exchange federal grants.